MARYLAND
BOARD OF PHARMACY
WHOLESALE DISTRIBUTOR PERMITTING AND PRESCRIPTION DRUG INTEGRITY ACT
ANNUAL REPORT TO THE GOVERNOR
AND
THE GENERAL ASSEMBLY
January 1, 2008
MARYLAND BOARD OF PHARMACY WHOLESALE DISTRIBUTOR PERMITTING AND PRESCRIPTION DRUG INTEGRITY ACT
ANNUAL REPORT
TABLE OF CONTENTS
BOARD MEMBERS...... ………………………………..………………..……..…3
EXECUTIVE SUMMARY………………………………………...………………………..4
INTRODUCTION AND DEVELOPMENT OF REGULATIONS………………………....6
IMPLEMENTATION OF NEW REGULATORY REQUIREMENTS...…………………...7
WORKGROUP TRACK AND TRACE SURVEY PROGRESS...... ………………….7
CONCLUSION…………………………………………………………………………….…9
APPENDIX I...... 10
APPENDIX II……. …………………..………………………………………..…….………12
APPENDIX III...... 15
APPENDIX IV...... 34
Members of the Maryland Board of Pharmacy
Donald W. Taylor, President
David Chason, Secretary
Michael M. Souranis, Treasurer
Mayer Handelman
Rodney Taylor
Cynthia Anderson
Harry Finke, Jr.
Lynette Bradley-Baker
Lenna Israbian-Jamgochian
Reid A. Zimmer
Margie A. Bonnett
Alland Leandre
Board of Pharmacy Staff
LaVerne G. Naesea, Executive Director
Anna D. Jeffers, Legislation and Regulations Manager
EXECUTIVE SUMMARY
This is the first annual report on the implementation of the Wholesale Distributor Permitting and Prescription Drug Integrity Act (the “Act”) as required by Health Occupations Article, Subtitle 6C, Annotated Code of Maryland.
The purpose of this Act, Senate Bill 759, Chapter 352, is to impose additional requirements for persons applying to be licensed to distribute prescription drugs or devices into Maryland, including requiring a pedigree, or history of the distribution chain, for prescription drugs that are distributed in Maryland. As part of the 2007 Act, the Board of Pharmacy (the “Board”) is required to adopt regulations for its implementation by January 1, 2008. Additionally the Board was required by the Act to convene a Workgroup (Wholesale Distributor SB 759 Workgroup) to:
(1) Survey the availability of electronic track and trace pedigree technology across the entire prescription pharmaceutical supply chain;
(2) Determine when electronic track and trace pedigree technology will be universally available across the entire prescription pharmaceutical supply chain; and
(3) Based on its determination of the universal availability of electronic track and trace pedigree technology, make recommendations to the Board for a target date, no sooner than July 1, 2010, for implementation of electronic track and trace pedigree technology across the entire prescription pharmaceutical supply chain.
The Board is also required to submit a report with the recommendations of the Workgroup to the Senate Education, Health, and Environmental Affairs Committee (EHE) and the House Health and Government Operations Committee (HGO) on or before January 1, 2009,and to establish a target date for implementation of electronic track and trace pedigree technology on or before July 1, 2009.
This report sets forth the status of implementation of requirements under the Act. The Workgroup consists of stakeholders that were involved in workgroups before HGO to negotiate the provisions of the legislation. Although not required by the Act, the Board initially asked the Workgroup to review the current wholesale distributor regulations and to recommend draft regulatory language for the Board’s consideration. The Workgroup recommendations were submitted to the Board on August 13, 2007. After review and consideration, the Board accepted the recommendations, with minor revisions, at its October 17, 2007 and November 14, 2007 Public Board Meetings. As of the date of this submission, proposed regulations are going through the regulatory review process at the Department of Health and Mental Hygiene (DHMH). Once effective, the Board will begin implementing the Act by licensing wholesale distributors under the new regulations.
The Workgroup will continue collecting information regarding electronic track and trace technology with the eventual plan of conducting a survey of the availability of electronic track and trace pedigree technology across the entire prescription pharmaceutical supply chain. The survey is anticipated to be completed and analyzed by the fall of 2008. Based on the findings, the Workgroup will determine the universal availability of electronic track and trace pedigree technology and make recommendations to the Board for implementation of electronic track and trace pedigree technology across the entire prescription pharmaceutical supply chain. As required by the Act, the target date will be after July 1, 2010.
Following receipt of the Workgroup recommendations, the Board will submit a report to EHE and HGO with the recommendations of the Workgroup no later than January 1, 2009. The Board will submit the target date for implementation of electronic track and trace pedigree technology to EHE and HGO on or before July 1, 2009.
INTRODUCTION AND DEVELOPMENT OF REGULATIONS
The Board chaired and staffed a workgroup of wholesale distributor stakeholders to review the current wholesale distributor regulations and recommend draft regulatory language. Several Workgroup participants were also part of the group that recommended bill provisions before HGO related to the passed legislation (listed in Appendix I). A website (Google Group) was set up as a convenient way for Workgroup participants and interested persons to review meeting information, meeting handouts, related materials and the progress of the Workgroup. A listing of persons that have accessed the Google Group website are listed in Appendix II.[1]
The Workgroup met on June 11, 2007, July 9, 2007, August 13, 2007, September 10, 2007, November 19, 2007 and December 10, 2007. During the first three meetings the participants reviewed the existing Maryland regulations COMAR 10.34.22.01 - .09 Licensing of Wholesale Prescription Drug or Device Distributors and similar existing regulations from various states who have enacted similar legislation. The Workgroup also reviewed model wholesale distributor regulations received from the National Association of Boards of Pharmacy (NABP) and the Pharmaceutical Research and Manufacturers of America (PhRMA). At the August 13, 2007 Workgroup meeting, the Workgroup agreed on draft regulations to recommend to the Board (see Appendix III).
The Board accepted the Workgroup’s recommended regulations with some minor revisions. The revisions included:
· Insuring that all requirements of the statute are incorporated in the regulations;
· Adding the definition of “Co-licensed Partner” from SB 759;
· Requiring additional contact information from applicants;
· Revising language regarding the designated representative to require documented training sufficient to ensure that the operations of the wholesale distributor are in compliance with applicable State and federal laws;
· Adding the wholesale distribution of prescription drugs or devices that were donated under the Prescription Drug Repository Program, Health-General Article, Title 15, Subtitle 6, Annotated Code of Maryland to the list of violations of the regulations;
· Requiring that if no storage requirements are established for a prescription drug or device, the drug or device shall be held at a controlled room temperature as defined in an official compendium as set forth by the United States Pharmacopeia/National Formulary (USP/NF) under 21 CFR §205.50(c);
· Rewording “shortages or losses” to “inventory losses;” and
· Requiring that wholesale distributors consider the factors listed in the regulations regarding what constitutes a significant inventory loss.
The Board approved the Workgroup’s recommended regulations with the Board’s revisions at the October 17, 2007 Public Board Meeting. At the November 14, 2007 Public Board Meeting, the Board approved adding language to clarify the routine inspection of wholesale distributors at the time of renewal. The proposed regulations were then submitted to the Department of Health and Mental Hygiene, Office of Regulation and Policy Coordination, for review and submission to the Maryland Register for publication (see Appendix IV). The proposal is anticipated to be published in January 2008. Since all the major stakeholders participated in the drafting on these regulations it is anticipated that there will be a limited number of comments received during the official 30 day comment period that follows publication.
IMPLEMENTATION OF NEW REGULATORY REQUIREMENTS
The Board will utilize the statute and the proposed regulations to develop new applications and permit processes. Once the regulations become effective in 2008, the program will be fully operational and the Board’s Licensing Unit will begin implementing requirements for all new wholesale distributor permit applicants and for existing wholesale distributor permits upon renewal. One substantive change to be included in the new licensure process is requirements related to inspection of wholesale distributors located in Maryland. The Board has also begun to develop procedures and seek personnel resources to insure that the new system for inspections can be fully implemented following the effective date of the regulations.
WORKGROUP TRACK AND TRACE SURVEY PROGRESS
SB 759 also required the Board to convene a Workgroup to (1) survey the availability of electronic track and trace pedigree technology across the entire prescription pharmaceutical supply chain; (2) determine when electronic track and trace pedigree technology will be universally available across the entire prescription pharmaceutical supply chain; and (3) based on its determination of the universal availability of electronic track and trace pedigree technology, make recommendations to the Board for a target date, no sooner than July 1, 2010, for implementation of electronic track and trace pedigree technology across the entire prescription pharmaceutical supply chain. The Board is also required to submit to EHE and HGO (1) on or before January 1, 2009, a report with the recommendations of the Workgroup; and (2) on or before July 1, 2009, the target date for implementation of electronic track and trace pedigree technology established by the Board.
Beginning at the September 10, 2007 Workgroup meeting, the Workgroup discussed how to approach the survey. Recognizing the need to educate the Workgroup participants concerning electronic track and trace technology, the Workgroup invited experts in the field to make presentations at the September, November and December 2007 meetings. The presentations will better enable the Workgroup to formulate valid survey questions.
At the September 10, 2007 Workgroup meeting John Howells, Director, Industry Relations at the Healthcare Distribution Management Association (HDMA), made a presentation introducing electronic product code (EPC) and radio frequency identification (RFID). RFID uses radio waves to identify items. An EPC system contains unique identifiers that allow identification of numerous items at the same time. A common example of this technology is the Easy Pass sensor system that is used to identify automobiles and bill automobile owners for highway tolls. Mr. Howells indicated that the industry is motivated to develop this technology so that it may improve patient safety, meet regulations, reduce costs and diversion, highlight short dated products and ensure more concise prescription dispensing.
There have been a number of industry initiatives to develop RFID technology. Mr. Howells listed in his presentation that GlaxoSmithKline, H.D. Smith, Pfizer, Purdue, Wal-mart CII, Department of Defense, AmerisourceBergen, Cardinal, McKesson, CVS Caremark, Rite-Aid, Walgreens and others have conducted pilot programs. Pfizer is already using RFID technology for Viagra and Celebrex. There have also been a number of association white papers and cost/benefit studies. An RFID/Track & Trace Health Care Industry Adoption Summit has been scheduled for November 2007 in Washington, D.C. sponsored by NACDS and HDMA. A number of Workgroup participants, Google Group members, Board members and staff will attend this summit.
In his presentation Mr. Howells indicated that there are some major aspects that remain to be completed before industry wide adoption. They include:
· Uniform standards under development
· Uniform implementation of track and trace technology across states
· Data sharing, ownership
· Frequency, as in radio frequency
· Incorporating new technology
· Developing tag numbering schemes
· Insuring Privacy
· Agreed upon industry roll out plan
The Workgroup learned that tracking may occur at any level in the supply chain and is U.S. Federal Trade Commission (FTC) compliant. Antennas to read RFIDs may be hand-held readers or as large as four feet square. The sizes of the antennas are constantly changing as the technology develops. The cost for RFID tags ranges from a nickel to 10 to 20 cents per tag. The RFID tags could be placed on a pallet, case or bottle and eventually will be item driven. The RFID tags have the ability to record transaction times and dates, as well. The U.S. Food and Drug Administration (FDA) will publish a paper soon regarding the affects of RFID on proteins and biologicals. It has been suspected that radio frequencies may alter or interfere with the chemical make up of some proteins and biologicals. RFID technology can read up to 600 feet per minute in some cases, reading data and populating a database. The question remains as to what is shared from that database and with whom. It will be a challenge to only track products outside the normal distribution channel because different states require different tracking. Eventually the industry will need to track all products. HDMA is currently in the process of implementing standards which may be finalized by the end of the year. However, industry adoption of those standards by others in the industry will be a longer process.
Michael Rose from Johnson & Johnson and Ramesh Murthy from CVS Caremark, are scheduled to make presentations to the Workgroup at the November and December 2007 meetings, respectively. Each will present concerning their company’s readiness, standards and approach to electronic pedigrees. A summary of those presentations will be included in the next Board report.
During early 2008 the Workgroup plans to formulate survey questions regarding the availability of electronic track and trace pedigree technology across the entire prescription pharmaceutical supply chain utilizing broad benchmark questions. The Workgroup will conduct the survey and then make recommendations to the Board for a target date that can be no sooner than July 1, 2010, for implementation of electronic track and trace pedigree technology across the entire prescription pharmaceutical supply chain.
CONCLUSION
During this first year that the Act has been in place the Board has convened the Workgroup, staffed the Workgroup and established the Google Group to efficiently disseminate information. The Board and the Workgroup have been proactive in revising COMAR 10.34.22 Licensing of Wholesale Prescription Drug or Device Distributors and publication of that regulatory proposal in the Maryland Register should occur in January 2008. During the fall of 2007, the Workgroup obtained information from industry experts and will be able to begin formulating and conducting the mandated survey in 2008. Full implementation of the Act is anticipated during 2008 and a recommended target implementation date for electronic track and trace technology will follow in 2009.
The Board, EHE, HGO and industry stakeholders have worked diligently over the past four years to bring this legislation to fruition. As concerns regarding the safety of U.S. prescription medications have grown, the Maryland Legislature was wise to address those concerns by placing stringent restrictions on those entities and individuals who distribute prescription medications in Maryland. The FDA has witnessed an increase in counterfeiting activities as well as a more sophisticated ability to introduce finished dosage form counterfeits into legitimate drug distribution channels over the years. [2]